|
Advanced Search Options
Central Excise - Case Laws
Showing 241 to 260 of 81789 Records
-
2025 (1) TMI 534
Denial of SSI exemption - use of brand name “SaBari”, which belonged to others - invocation of extended period of limitation - interest - penalties.
Whether the Appellant A1 is entitled to exemption of Notification No. 8/2003-C.E. as amended? - HELD THAT:- The Appellant using the brand name of others did not own that particular brand name during investigation which according to the Revenue itself was the brand name registered for other different products. Evidently, these products had no business connection whatsoever with the Appellant herein. Further, the Department had not conclusively proved that the brand name for kitchen items has been used by the Appellant with the intention to establish a connection, or to indicate a connection, with others who are into business of dealing in other items other than kitchen articles. The use of brand name “SaBARI” in the instant case can be termed as fortuitous, there being no intention on the part of the appellant to use the said brand name to show a connection with the Assessee’s goods and such other person - the Appellant is entitled to SSI exemption under Notification No. 08/2003 as amended.
Quantification of duty payable - HELD THAT:- It appears that invoice wise sale turnover for all the years has been arrived at by the investigation. But the reasons for not allowing deductions towards Bought out items, value of supplies to SEZs and post manufacturing expenses are not forthcoming. As such, for quantification of the duty, the issue is remanded to the Original Adjudicating Authority for arriving at the taxable turnover allowing the benefit of the SSI exemption.
Invocation of Extended period of limitation - HELD THAT:- The Sabari brand name was registered for different items by different persons and there is no clash of interest while using this brand name for manufacture and sale of kitchen appliances by the Appellant. The arguments that the Appellant is of genuine impression that he is eligible for SSI exemption is acceptable. As such, there is no justification for invocation of the extended period and demand for normal period only is sustainable in the facts of this appeal.
Interest - HELD THAT:- The Appellant is entitled to provide a Chartered Accountant’s certificate supporting his claims to the Department and is directed to pay the duty amount along with applicable interest if any, for the normal period after crossing the threshold limit, under intimation to the department. The interest under Section 11AB of Central Excise Act, 1944 shall be applicable on such recalculated duty.
Penalties - HELD THAT:- The issue of eligibility for SSI exemption benefit and also Limitation have thus been decided in favour of the Appellant. As such, imposition of penalties on the Appellant A1 and Mr. Thangevelu, the Managing Director (A2) is not legal and so ordered to be set aside.
Conclusion - i) The use of brand name “SaBARI” in the instant case can be termed as fortuitous, there being no intention on the part of the appellant to use the said brand name to show a connection with the Assessee’s goods and such other person. The Appellant is entitled to SSI exemption under Notification No. 08/2003 as amended. ii) For quantification of the duty, the issue is remanded to the Original Adjudicating Authority for arriving at the taxable turnover allowing the benefit of the SSI exemption. iii) There is no justification for invocation of the extended period and demand for normal period only is sustainable in the facts of this appeal. iv) The interest under Section 11AB of Central Excise Act, 1944 shall be applicable on recalculated duty. v) The penalties set aside.
The impugned Order-in-Original is modified to the extent of re-computation of duty payable after allowing the SSI exemption benefit for normal period. Thus, this appeal is allowed by way of remand.
-
2025 (1) TMI 533
Refund of unutilized cenvat credit accumulated on inputs and input services used in the export of final products - rejection on the grounds of non-submission of some relevant documents for processing the refund claim - applicability of time limitation - claim was filed belatedly beyond one year as stipulated under law.
Time Limitation - HELD THAT:- Indisputably it is an admitted fact that the original refund claim filed was returned to the appellant. When the prevailing instructions itself according to the Appellate authority requires that submission of refund claims without supporting documents is not to be allowed, the factum of its return presupposes its filing with supporting documents, albeit later found to be of incomplete nature. Thus, the reliance placed by the learned appellate authority on the decision in MALWA COTTON SPINNING MILLS LTD. VERSUS CCE, LUDHIANA [2013 (5) TMI 318 - CESTAT NEW DELHI] is misplaced which even otherwise was a case was on interest liability and not on limitation.
This Tribunal, in M/S ABHEDYA INDUSTRIES LTD. VERSUS COMMISSIONER C.C.E & ST, HYDERABAD-III (VECE-VERSA) [016 (7) TMI 1113 - CESTAT HYDERABAD], has held the law to be settled that that the date of initial submission of the refund claim shall be the actual date of submission for the purpose of limitation under Section 11B of Central Excise Act, 1944 and not the date of resubmission.
This Tribunal in its decision in M/S. CHENNAI PETROLEUM CORPORATION LTD. VERSUS THE COMMISSIONER OF G.S.T. & CENTRAL EXCISE [2019 (6) TMI 189 - CESTAT CHENNAI] has followed the Gujarat High Court decision in United Phosphorous v UOI, supra and has held that when the refund sanctioning authority who received the original refund claims has not rejected these refund claims on merits and has merely returned the same, further filing of the refund claims ought to be considered only as resubmission and not as fresh claims.
Conclusion - The date of the original submission of a refund claim is the relevant date for determining the timeliness under Section 11B of the Central Excise Act, 1944. The refund claim filed by the Appellant is to be taken as filed on 23.11.2012, the date on which the original refund claim was acknowledged as received by the Department.
Appeal allowed.
-
2025 (1) TMI 532
Availment of Cenvat credit, both on inputs as well as capital goods, when the final goods are exempted - use of common inputs for manufacture of partly exempted and partly dutiable goods - HELD THAT:- The Adjudicating Authority, inter alia, observed that availing of Cenvat credit amounting to Rs.42,34,504/- on raw materials exclusively used in the manufacture of exempted goods viz., lateral pipes and drippers, there is a clear contravention of the provisions of Rule 6(1) of CCR. She also observed that the provisions of Rule 6(2) of CCR are available only in respect of common inputs and not in respect of inputs used exclusively in the manufacture of exempted goods.
In so far as non-fulfilment of requirement under Rule 6(2) of CCR is concerned, where the inputs were used both in the manufacture of dutiable goods as well as exempted goods, after going through the submissions and evidence, the Adjudicating Authority found that the appellant has not fulfilled all the conditions required under Rule 6(2) of CCR and they have not chosen the option under Rule 6(2), the appellant will be required to comply with Rule 6(3)(b) of CCR and pay the amount equivalent to 10% of the price of the exempted goods cleared from the factory and since the appellant has not paid the same, the amount is required to be recovered as they have contravened the provisions of Rule 6(3) of CCR.
The Adjudicating Authority has given a very reasoned order consistent with the statutory provisions for upholding the demand of the department except to the extent of allowing abatement of actual duty paid on the exempted goods against the demand under provisions of Rule 6(3) read with Rule 14 of CCR. Therefore, there are no reason to interfere with the impugned order on this count as the Adjudicating Authority has rightly sustained the demand against the appellant raised vide SCN dt.02.06.2010.
Conclusion - i) Cenvat credit cannot be availed for inputs and capital goods used exclusively for exempted goods and highlights the necessity to comply with Rule 6 procedures when using common inputs. ii) The Adjudicating Authority has rightly allowed the abatement. iii) The total demand confirmed would be duly adjusted after working out the actual payment of duty on the exempted goods by the appellant.
The impugned order upheld - appeal dismissed.
-
2025 (1) TMI 531
Rejection of refund claim - classification of Undenatured Ethyl Alcohol - classifiable under the heading 2204 or not - Adjudicating Authority holds that the credit taken by the Appellant in relation to the manufacture of the Undenatured Ethyl Alcohol (described by the Adjudicating Authority as being non-excisable) was without the authority of law - HELD THAT:- Respectfully following the decision of co-ordinate Bench in the Appellant’s own case [2017 (12) TMI 314 - CESTAT CHENNAI], that the Undenatured Ethyl Alcohol is not excisable. Once the goods are not excisable, they cannot be considered exempt to fall within the scope of Rule 6(3). The Commissioner (Appeals) in the impugned order was thus right in holding that the Appellant could not have claimed credit in the first place so as to reverse the same by payment, and that the reversal of such credit by payment p ut the Appellant in a position in which it was compliant with the law. Hence, the Commissioner (Appeals) was also right in holding that there was no question of granting refund as claimed.
Conclusion - The goods not classified as excisable under the tariff cannot be treated as exempt and do not fall within the scope of Rule 6(3) of the CENVAT Credit Rules. The appellant's claim for a refund was not justified, as the goods in question were not excisable.
There are no merit in this Appeal filed by the assessee and accordingly, the same is dismissed.
-
2025 (1) TMI 530
100% EOU - Exemption from payment of BCD and SAD - eligibility for DTA clearance in terms of the policy as they did not undertake any physical exports of the final products - HELD THAT:- The Principal Bench of the Tribunal in the case of appellants themselves in M/S MENETA AUTOMOTIVE COMPONENTS PVT. LTD., SHRI PRAVEEN GARG, AUTHORISED SIGNATORY VERSUS CCE & ST, ROHTAK [2015 (4) TMI 733 - CESTAT NEW DELHI] has held that 'Since on the goods sold into DTA, VAT levied by the State Government has been paid, and in this regard, there is no dispute, the conditions of exemption Notification No. 102/2007-CUS dated 14/09/07, as applicable to the DTA clearances of a 100% EOU, have been substantially satisfied and hence the goods would be fully exempt from SAD as, in our view, the benefit of this notification, which has been issued for the goods imported by person for subsequent sale and whose condition have been prescribed accordingly, cannot be denied in respect of DTA clearances of a 100% EOU if the condition as applicable mutatis mutandis to DTA sales are satisfied.'
Further on the issue of payment of Education Cess and Secondary and Higher Education Cess, Ahmedabad Bench of the Tribunal has decided the issue in favour of the appellants in the case of SARLA PERFORMANCE FIBERS LTD. VERSUS COMMISSIONER OF C. EX., VAPI [2010 (2) TMI 335 - CESTAT, AHMEDABAD] holding that 'once education cess is added to the customs duties to arrive at aggregate of customs duties, the question of charging education cess again does not arise. Because once it is a enhancement, it is part of the relevant type of the duty. What is required for the purpose of proviso to Section 3 of Central Excise Act, 1944 is to arrive at aggregate of customs duties and once we take a view that education cess is part of the customs duty and is an enhancement, the question of adding it again does not arise.'
Conclusion - Exemptions under customs notifications apply to DTA clearances if the conditions are met. Education Cess is a surcharge and should not be levied multiple times.
The impugned order is not sustainable in law - Appeal allowed.
-
2025 (1) TMI 529
Eligibility to take input service credit on Road Side Assistance Service, Market Research and Service Tax paid on Demurrage - levy of penalty - demand of interest on Cenvat Credit wrongly taken in the Books but not utilised.
Cenvat Credit on Road Side Assistance - HELD THAT:- On going through Section 4(3) of the Central Excise Act, 1944 it is found that the transaction value means the price actually paid or which are payable for the goods when sold and those includes servicing and warranty also. Admittedly the service and warranty is post manufacturing expenses which are to be provided to the customer after the sale. As per the provision of Section 4(3)(d) the value of warranty and servicing, which is a post manufacturing activity are includible in the assessable value and therefore, these expenses incurred are entitled for input service credit. Thus RSA being in the nature of post-sale customer facilitation service, is actually availed by customers after sale of the vehicle and would be squarely covered under the definition of the activity related to business and therefore is entitled for input service credit - thus, input service credit is allowable on Roadside Assistance Service.
Cenvat credit availed on the services used for Study on Automobile Manufacturing investment - HELD THAT:- A perusal of the records indicate that the Assessee have engaged M/s. IPN Associates to conduct a study on incentive benefits provided by various State Governments in order to decide on the place of investment. We find that the above study has no relation with the business activity of the Assessee i.e., manufacturing and selling of cars. No nexus exists with the business activity of the Assessee. The work assigned does not have anything to do with the customer needs, demand and supply in car market, consumer feedback or any analysis of market data. The study was not research about the products of the Assessee or their marketability. As such, the Assessee’s argument that the service availed was in the nature of market research or relating to their business is not acceptable. It cannot be said to be connected either directly or indirectly with the manufacturing process or the business of the Assessee and as such, it cannot be covered under the definition of input service under Rule 2(l) of the CCR, 2004.
Cenvat Credit on demurrage charges - HELD THAT:- Though service tax is not chargeable on container detention charges, the Assessee is eligible to take input tax credit of service tax paid on demurrage charges paid to the Port Trust as it is related to procurement of inputs and also it can be said to be connected and in or in relation to the business of the Assessee. As the Assessee had paid the said demurrage charges together with the service tax to the Port Trust, the transaction being revenue neutral, the availment of credit need not be interfered with.
Demand of Interest on irregular Cenvat Credit taken - HELD THAT:- Hon’ble High Court, Madras in the case of CCE, Madurai Vs. M/s. Strategic Engineering (P) Ltd. [2014 (11) TMI 89 - MADRAS HIGH COURT], considering the fact that the Assessee had an accumulated credit balance of around Rs.70 Crores evidencing that the ineligible credit availed was not utilised. The Hon’ble High Court of Karnataka in the case of Commissioner of Central Excise & Service Tax, LTU, Bangalore Vs. M/s. Bill Forge Pvt. Ltd. [2011 (4) TMI 969 - KARNATAKA HIGH COURT] has held that mere wrong availment of Cenvat credit does not attract interest liability unless such Cenvat credit was taken and utilised wrongly - no interference is called for on this issue and the issue is decided in favour of the Assessee. Therefore, the appeal filed by the Revenue cannot be sustained and so ordered to be set aside on the issue of demand of interest.
Levy of penalty - HELD THAT:- As the main demands i.e., Cenvat credit on Road Side Assistance and also demand of interest on reversal of ineligible Cenvat credit are not sustained, imposition of penalty is not called for as there is a genuine problem of interpretation of whether these services are eligible for credit or not and no intent to evade or suppression can be attributed to the conduct of the Assessee.
Conclusion - i) Cenvat Credit on service tax paid on Road Side Assistance is eligible as input service credit. ii) Cenvat Credit on Study on Investment is not eligible as input service credit and the Assessee is liable to reverse the input service credit taken. iii) Demand of interest on reversal of ineligible Cenvat Credit taken is set aside. iv) Penalty imposed is also set aside.
The appeal filed by the Assessee is partly allowed.
-
2025 (1) TMI 528
Failure to pay duty as per the amended provision of law - demand with interest and penalty - extended period of limitation - reduction of the demand of the duty by extending the benefit of cum duty.
HELD THAT:- It is an admitted fact that there is an omission on the part of appellant to pay excise duty as per the prevailing rate and for that reason the demand is sustainable and they have paid said amount. As regarding the demand against Appeal No. E/27329/2013, it is evident that the appellant was filing ER-1 return from time to time and the omission on the part of appellant to pay the duty as per the Notification was not noticed by the department and only when it is noticed, they failed to demand within the statutory period. Thus considering the delay of issuing the notice, the demand under Appeal No. E/27329/2013 is barred by limitation. As regarding the Appeal No. E/27330/2013, it is found that the appellant is liable to pay duty for the relevant period. However, as regarding the cum duty benefit, the issue was considered by this Tribunal in the matter of Shri Chakra Tyres Ltd., [1999 (3) TMI 100 - CEGAT, NEW DELHI] and it is held that 'assessable value is required to be determined in terms of Section 4 of the Act. Sub-section 4(d)(ii) envisages deduction of aggregate effective duty payable on the goods under the Act, and all other Acts, if the wholesale price at which goods are sold includes all such excise duties. Wholesale price is the total consideration received by an assessee against sale of excisable goods in wholesale trade.'
The original consideration (including duty, if any) received by the appellant, has to be taken as cum-duty price for the purpose of demand of higher duty, subsequently.
Conclusion - i) Total duty proposed to be demanded shall have to be abated from the cum-duty price actually received and liable to be received as a consideration for sale of goods. ii) Excess duty with interest is payable by the appellant. iii) No penalty is explicitly imposed.
Appeal allowed.
-
2025 (1) TMI 527
Dismissal of appeal - appeal dismissed on merits as well as for want of pre-deposit - violation of principles of natural justice - HELD THAT:- The order passed in violation of the principles of natural justice cannot survive and has to be set aside for re-adjudication of the same by some other competent person to decide the matter.
Conclusion - Matter remanded back to the Commissioner (Appeals) for reconsideration of the appeals as pre-deposit for filing of these appeals have been made before the Tribunal, Commissioner (Appeals) should treat the same as pre-deposit for hearing the appeals without insisting for further pre-deposit.
Appeal allowed by way of remand.
-
2025 (1) TMI 526
Cenvat Credit of 2% countervailing duty paid on imported coal - Rule 3(1) of Cenvat Credit Rules, 2004 - HELD THAT:- Reliance placed in the case of COMMISSIONER OF CGST AND CX, BOLPUR COMMISSIONERATE VERSUS M/S. SHYAM STEEL INDUSTRIES LIMITED [2022 (9) TMI 230 - CALCUTTA HIGH COURT] wherein the Hon’ble High Court has observed 'taking into consideration Notification No. 12/2012-Cus there is no bar for availment of CENVAT Credit in terms of the Rule 3(7) where duty paid under Notification No. 12/2012-Cus and CENVAT Credit cannot be denied.'
Conclusion - The appellant is entitled to Cenvat Credit of 2% CVD paid by them at the time of import of the goods.
Appeal allowed.
-
2025 (1) TMI 477
Demands made for violation of Rule 8(3A) of the Central Excise Rules, 2002 - HELD THAT:- This bench has in the case of M/S. SAS AUTOCOM ENGINEERS INDIA PVT. LTD. AND SHRI S. SHYAM RAJ VERSUS COMMISSIONER OF GST AND CENTRAL EXCISE, CHENNAI [2024 (11) TMI 343 - CESTAT CHENNAI], followed the ratio decidendi laid down in the aforementioned Judgements of the Honourable High Courts of Gujarat and Madras and has held 'Rule 8(3A) of Rules, 2002 is ultra vires of Article 14 of Constitution being unreasonable, irrational, arbitrary and violative.' - in view of the above position in law as settled by the Honourable Constitutional Courts, which is being consistently followed by this Bench, there is no merit in the confirmation of demands made in the impugned order and hence the impugned order cannot sustain.
Interest due on the duty amount paid by the Appellant - HELD THAT:- While the impugned order has confirmed the demand of additional payment towards interest due after considering the amount paid by the Appellant, on the basis of the report dated 06.04.2015 of the Preventive Unit, Puducherry; in light of the affidavit filed by the Appellant duly supported by the chartered accountant’s certificate, reiterating the payable interest as Rs.15,18,153/-, that has already been paid, we leave it to the Adjudicating Authority to verify the CA certificate, if felt necessary, and hold the Appellant to its affidavit. Registry is directed to forward a copy of the affidavit and the CA certificate filed to the jurisdictional Commissioner, while dispatching this order.
Conclusion - Rule 8(3A) of the Central Excise Rules, 2002, is unconstitutional and invalid as it infringes upon the substantive right of an assessee to utilize CENVAT credit. The rule is unreasonable, irrational, arbitrary, and violative of Article 14 of the Constitution.
The impugned order set aside - appeal allowed.
-
2025 (1) TMI 476
Disallowance/recovery of CENVAT Credit along with interest and imposed equal amount of tax as penalty - service tax paid under the reverse charge mechanism (RCM) for Goods Transportation Agency (GTA) services - Interest and penalty - HELD THAT:- The appellant has paid service tax on GTA service under RCM basis. Under RCM basis, the service tax liability is paid within 5th of the next month and the CENVAT Credit of the same is availed by the Appellant while filing the ST 3 return of the half year wherein the said amount paid by the Appellant is also shown as CENVAT Credit in the Cenvat table of the return. The same is also disclosed in ER 1 return by the Appellant. Thus, it is observed that the allegation of availment of CENVAT Credit without payment cannot arise as the payment is done within the due date of payment of service tax which is also visible from the table set out in the demand order. There is no dispute with respect to the genuineness of input services availed by them. Thus, the appellant is eligible to avail the credit and the allegation in this regard in the impugned order is not sustainable.
Utilization of credit before making payment of the service tax - HELD THAT:- It is observed that if the appellant has utilized the credit before making the payment of service tax on GTA service, at the maximum the department could have demanded interest for the few days before which the credit was utilised, before payment. However, it is observed from the submission of the appellant that although they have availed the CENVAT Credit during the relevant period, they have not utilised the credit for the payment of any other liabilities for the said month. Thus, there is no obligation on them to pay any interest.
Hon’ble Supreme Court in UOI AND ORS. VERSUS IND-SWIFT LABORATORIES LTD. [2011 (2) TMI 6 - SUPREME COURT] held that no interest is payable when there is no utilisation of CENVAT Credit. By following the ratio of the decisions, it is held that the appellant is not liable to pay interest as the credit taken by the appellant was not utilized before making the payment of service tax.
Levy of penalty - HELD THAT:- Since there is no irregularity in availment of the credit, no penalty imposable on the appellant and hence the penalty imposed in the impugned order is set aside.
Conclusion - i) The appellant is eligible to avail the CENVAT Credit of service tax of Rs. 1,35,91,278 - paid by them on RCM basis for Goods Transportation Agency Services and hence the demand confirmed in the impugned order along with interest, is set aside. ii) The penalty imposed on the appellant in the impugned order is set aside.
Appeal disposed off.
-
2025 (1) TMI 475
Liability of interest if differential duty is paid before finalization of provisional assessment in terms of Rule 7(4) of Central Excise Rules, 2002 - HELD THAT:- The issue regarding demand of interest on the goods which were cleared provisionally was considered by the Hon’ble High Court of Allahabad in the matter of M/s Bharat Heavy Electricals Ltd [2015 (8) TMI 1055 - ALLAHABAD HIGH COURT], wherein it is held that 'There is no doubt that interest is compensatory in nature and is imposed on an assessed amount who has withheld any tax as and when it was due and payable. Levy of interest is on actual amount of tax withheld and the extent of the delay in paying the tax on the due date'.
Conclusion - Interest on differential duty is a statutory liability that arises from the date of removal of goods, irrespective of when the differential duty is paid. The interest serves as compensation for the delay in payment of the duty due.
Appeal dismissed.
-
2025 (1) TMI 474
Eligibility of CENVAT Credit on inputs received from EOU unit of the appellant - Whether the credit availed by the appellant based on the strength of the invoices issued by the 100% EOU prior to amendment Rule 3(7)(a) of the Cenvat Credit Rules, 2004 by Notification No.22/2009 CE (NT) dated 07.09.2009 is correct or otherwise? - HELD THAT:- The very same issue was considered by this Tribunal in the matter of SHREYA PETS PVT. LTD. VERSUS COMMISSIONER OF CUS. & C. EX., HYDERABAD-IV [2008 (9) TMI 351 - CESTAT, BANGALORE], wherein it is held that 'Mumbai Bench has given a clear cut finding that appellants are entitled to avail 100% credit of Education Cess on the goods supplied to them by a 100% EOU in terms of the above findings. The findings given by the Commissioner (A) is not legal and proper and the same is set aside by allowing the appeal with consequential relief.'
Conclusion - Rule 3(7)(a) of the Cenvat Credit Rules, 2004, restricts the availment of credit only for the basic excise duty and does not extend to other duties such as Education Cess and Secondary Higher Education Cess. The appellant is eligible for the CENVAT Credit and the appeal is sustainable.
Appeal allowed.
-
2025 (1) TMI 425
Clandestine removal - whether CESTAT was justified in upholding the order of the Commissioner (Appeals) in which the appellant's challenge to the original order was dismissed based on the appellant's voluntary participation in the Kar Vivad Samadhan Scheme? - HELD THAT:- From the material available on record, it is evident that during pendency of the appeal against the order passed in original proceeding, the appellant with its eyes wide open had applied under the Scheme. Thereafter, the appellant paid the amount due under the Scheme and produced the certificate of payment. The Commissioner (Appeals) therefore was justified in dismissing the appeal preferred by the appellant on the ground that appellant is not entitled to challenge the order dated 28.10.1997. Despite several opportunities the appellant did not even appear before the Tribunal. The Appellate Tribunal by assigning valid and cogent reasons had affirmed the order passed by the Commissioner (Appeals). The orders impugned in this appeal do not suffer from any infirmity.
Conclusion - The order passed by the Commissioner (Appeals) does not suffer from any infirmity, as the appellant itself had opted for settlement under the Scheme and the amount was paid accordingly.
Appeal dismissed.
-
2025 (1) TMI 424
Clandestine manufacture and removal - circumstantial evidence are clearly brought out or not - evasion of duty is clearly established beyond doubt or not - whether the Tribunal can ignore binding admissions made by the managing partner of the respondent firm and its sole distributors and various other traders? - HELD THAT:- So far Section 9D (1) (a) of the Excise Act is concerned, it has no application in the instant case. Sub-section (1) (a) can be pressed into service (a) when person who had given the statement is dead, (b) when he cannot be found, (c) when he is incapable of giving evidence, (d) when he is kept out of the way by the adverse party and (e) when his presence cannot be secured without an amount of delay or expense, which officer considers unreasonable. In the considered opinion of this Court, this provision is based on doctrine of necessity. Admittedly, in the instant case, sub-section 1 (a) of Section 9D of the Excise Act has no application.
The judgment of Jharkhand High Court in Bihar Foundry & Casting Ltd’s [2022 (3) TMI 694 - JHARKHAND HIGH COURT] makes it clear that the statement recorded by the Gazetted Central Excise Officer during enquiry or investigation is in a quasi criminal proceeding. In this view of the matter, the word ‘prosecution’ needs to be understood. The proceeding may lead into imposition of penalty. In some cases, it may also result into ‘prosecution’. The view taken by Division Bench of Jharkhand High Court in Bihar Foundry & Casting Ltd. Thus, it is unable to persuade ourselves with the line of argument of revenue that because of use of the word ‘prosecution’ in Section 9D of the Excise Act, the requirement of producing evidence in adjudication proceeding can be done away with.
It is clear like noon day that the incriminating material/statements recorded behind the back of the petitioner cannot be used against him, unless, such witnesses are produced in adjudication proceedings and they were permitted to be cross-examined by the petitioner.
Conclusion - In the teeth of Section 9D (1) (b) of the Excise Act, unless, the incriminating material and witnesses are produced in the adjudication proceedings and are permitted to be cross-examined by the assessee, the said incriminating material cannot be used against the assessee.
Appeal dismissed.
-
2025 (1) TMI 423
CENVAT credit of additional duty of customs (SAD) availed by the Appellant can be demanded due to failure on the part of the Appellant to comply with Rule 3(5) of Cenvat Credit Rules, 2004 or not - suppression of facts or not - extended period of limitation.
HELD THAT:- The fact that the said items were imported inputs cleared 'as such' as established by the investigation by correlating the part number indicated in the invoices with those reflected in the Bills of Entry under which the said items were imported. Therefore, there has been a continuous attempt on the part of assessee to misrepresent and suppress the facts deliberately with the intention to avoid payment of the amount availed as CENVAT Credit at the time of 'as such' clearances. Thus, Appellant is liable to be imposed with penalty as held by the Adjudication authority.
Extended period of limitation - HELD THAT:- As per the finding in the impugned order, the Adjudication authority held that the facts regarding inputs cleared 'as such' was established by investigation. However as evident from the ER-1 return submitted by the Appellant and as per the invoices relied in the impugned order, Appellant had clearly mentioned in the invoice that the goods are cleared 'as such'. Facts being so, there is no reason to allege that the Appellant has suppressed the facts regarding removal of inputs 'as such' and it was not established by way of investigation by the Department. Hence, the impugned order is not tenable on limitation.
Reversal of Cenvat credit on 'as such' clearances - HELD THAT:- The case of the department is that they have not reversed the Cenvat credit taken of the SAD amounts, on their 'as such' clearances. However as per Rule 3(5) of Cenvat Credit Rules, 2004 when the goods are cleared as such they have to either reverse the Cenvat credit availed on such goods or pay duty equivalent to the Cenvat credit availed on such goods. In this case the appellant paid duty which was higher than the reversable Cenvat credit. Hence, there is no Revenue loss.
Conclusion - i) There has been a continuous attempt on the part of assessee to misrepresent and suppress the facts deliberately with the intention to avoid payment of the amount availed as CENVAT Credit at the time of 'as such' clearances. Thus, Appellant is liable to be imposed with penalty as held by the Adjudication authority. ii) There is no reason to allege that the Appellant has suppressed the facts regarding removal of inputs 'as such' and it was not established by way of investigation by the Department. Hence, the impugned order is not tenable on limitation. iii) In this case the appellant paid duty which was higher than the reversable Cenvat credit. Hence, there is no Revenue loss.
Appeal allowed.
-
2025 (1) TMI 422
Method of valuation of job-worked goods - it appeared that the value adopted by the Appellants by considering the cost of materials plus conversion cost, was not in accordance with Rule 10A (iii) read with Rule 8 of Central Excise Valuation Rules, 2000 (CEVR) resulting in short payment of duty - HELD THAT:- The Appellants have manufactured HDPE Plastic Caps on job work basis and have paid duty on the assessable value worked out by taking into account the cost of materials plus conversion cost. The principal manufacturer (M/s. Marico) used the caps for fitment onto bottles, in its factory, for filling coconut oil. The department therefore contends that after 01.04.2007 the valuation should be done applying Rule 10A(iii) r/w Rule 8 of Central Excise Valuation Rules which applies when goods are not sold. The appellant does not captively consume the goods nor does M/s. Marico consume it on behalf of appellant.
The very same issue has been considered by this Tribunal in the Appellants case [2018 (2) TMI 139 - CESTAT CHENNAI] following the judgement in the case of M/s. Advance Surfactants India Ltd. Vs CCE, Mangalore [2011 (3) TMI 1380 - CESTAT, BANGALORE], where it was held that 'it is undisputed that LABSA is manufactured by job worker and cleared to HUL for further consumption and the said LABSA is the intermediate product required by HUL which is manufactured or produced by the appellant as a job worker. The key words in Rule 8 that needs to be interpreted are ‘consumption by an assessee or on his behalf’ for applying the said Rule for arriving at valuation or determination of goods. In the case in hand, it is very clear and not disputed that the appellant is not consuming the said LABSA nor is it consumed on his behalf by HUL. In our considered view, the provisions of Rule 8 will not get attracted in this case.'
Conclusion - Rule 8 of the CEVR applies only when goods are consumed by the assessee or on their behalf, and that valuation should be based on the cost of materials plus job work charges when these conditions are not met.
The demand confirmed is not legally sustainable and requires to be set aside - Appeal allowed.
-
2025 (1) TMI 421
CENVAT credit can be availed by the Gurgaon unit of the appellant when the invoices had been inadvertently addressed to the Bangalore office - Extended period of limitation - HELD THAT:- The appellant is presently the only unit engaged in the manufacture of the said goods and it’s another unit at Bangalore which was operative has closed down from April 2007. It is also found that it is not in dispute that the service tax under reverse charge has been paid by the Gurgaon unit and GAR-7 challan also mention the address of the Gurgaon unit and payment has also been made by the appellant and therefore, the Gurgaon unit is eligible to avail CENVAT credit in respect of these invoices. Further, the appellant has produced on record the service tax payment challan which is a valid document for availment of CENVAT credit in terms of Rule 9(1)(e) of CENVAT Credit Rules. It is found that in the present case, the input services could not have been used by any other unit other than the Gurgaon unit being the only manufacturing unit and moreso, when they have discharged the service tax liability under reverse charge, it has been consistently held in the decisions relied upon by the appellant that CENVAT credit can be availed on the basis of challan evidencing payment of duty.
The Department has not been able to establish suppression on the part of the appellant with intent to evade payment of service tax and therefore, the invocation of extended period of limitation is not justified in the present case.
The impugned order is not sustainable in law - Appeal allowed.
-
2025 (1) TMI 420
Valuation for stock transfers to sister units - Short payment of duty due to under valuation - Excess payment of duty due to over valuation of finished goods - Excess duty payment resulted in 'excess' refund not falling under impugned notification - reversal of refund being excess - area- based exemption under N/N. 56/2002-CE dated 14.11.2002 availed - Levy of penalty - HELD THAT:- During the period of dispute from 27.08.2004 to 07.06.2005, the appellant had cleared goods on stock transfer to their sister units at Dadra and Silvasaa but while clearing the goods, it was not possible to determine the cost of production for each removal and therefore, the appellant transfer the stock at pre-determined value based on previous year CAS-4 data and after the cost audit which resulted in over or under valuation when each invoice was taken separately and the same resulted in excess payment or short-payment.
It is noted that wherever there was a short payment of duty, the appellant paid it immediately along with interest and in the case of excess payment of duty, the Department has demanded the same as to the extent of excess duty paid where the appellant has availed the excess refund - sub-section (2B) of Section 11A specifically provides that the assessee in default may, before the notice issued under sub-section (1) is served on him, make payment of the unpaid duty on the basis of his own ascertainment or as ascertained by a Central Excise Officer and inform the Central Excise Officer in writing about the payment made by him and in that event he would not be given the demand notice under sub-section (1).
Levy of penalty - HELD THAT:- The short/ excess payment of duty was being made due to provision of Valuation Rules in case of supply to the related party, hence, there is no intention to evade payment of duty because whatever duty paid was available as refund to the appellant and hence there is no intention to evade payment of duty and therefore, no penalty is liable to be imposed.
Conclusion - The short/ excess payment of duty was being made due to provision of Valuation Rules in case of supply to the related party, hence, there is no intention to evade payment of duty.
The impugned order is not sustainable in law and is therefore set aside - appeal allowed.
-
2025 (1) TMI 419
Benefit of N/N. 50/2003-CE dated 10.06.2003 - non-fulfilment of criteria required for availing of the said exemption in as much as they have not commenced commercial production on or before the appointed date i.e. 1.03.2010 - HELD THAT:- The department has tried to establish the case on the basis of the visit of the central excise offices on 06.04.2010 and certain conclusions drawn on the basis of circumstances and thus comes to a conclusion that commercial production would not have been commenced from 31.03.2010. It is also mentioned that raw material/parts of galvanization pipes were purchased vide invoices dated 09.04.2010, 19.04.2010 and 04.09.2010, and, therefore, no production could be started on 31.03.2010.
It is found that Superintendent, Central Excise Range, Bilaspur, issued certificate dated 29.07.2010 certifying that the unit of the appellant was working and availing exemption under Notification No. 50/2003- CE. It is pertinent to note that the said certificate was later than the date of visit of the officers. It is failed to understand as to why the Commissioner relied on one set of evidence while ignoring the report of the superintendent, when both evidences are by the department itself.
The appellant’s submits on the basis of available CENVAT credit is also not considered by the learned adjudicating authority. In view of the categorical certification by the Range Superintendent that the unit has been operational as on 31.03.2010, availing exemption and due to the fact that the allegation of clandestine production and sale has not been evidenced and even a minimum level of investigation into the transportation and financial transactions of excisable goods, was conducted, it is opined that the issue needs to travel back to the original authority for a fresh consideration of all the issues relevant to the case after taking into account the submissions of the appellants and on verifying the available evidence in the form of documents and after giving due opportunity to the appellants in the interest of natural justice.
Conclusion - It is failed to understand as to why the Commissioner relied on one set of evidence while ignoring the report of the superintendent, when both evidences are by the department itself.
The appeal is allowed by way of remand and it is directed that the order in remand to be passed within 16 weeks of the receipt of this order, as far as possible.
............
|
9911796707
